New Zealand Prime Minister John Key has officially announced details of the royal commission into the Pike River Coal mining tragedy, where 29 men perished last week.

High Court Judge Justice Graham Pankhurst will lead the inquiry, as well as two additional judges to be announced shortly.

An international mining expert will also be recruited by the Department of Labour to carry out urgent audits of all underground mining in New Zealand.

This follows reports of a ban on underground mining in New Zealand following the Pike River blasts.

In a press conference this afternoon, Key said the royal commission was the appropriate inquiry into the tragedy and will start work as soon as possible.

"Royal Commissions are reserved for matters of very significant public interest and the Pike River mine tragedy is without question one of those," Key said.

The commission, which will costs millions of dollars, will investigate the cause of the explosion, the cause of loss of life, the search and rescue operation, the systems at the mine, and applicable rules and regulation in the industry as a whole.

“We owe it to the men who died in the mine to finds out what happened and why. We must find out all we can so we can make sure this tragedy isn’t repeated” Key said.

The announcement that the family of miners killed in the blasts will have a heavy involvement in the inquiry has been welcomed, and they say they are desperate for answers about how the disaster could have happened in a mine less than two years old.

Brenda Rackley is the partner of John Hale, who perished in the mine and she says he would often voice his concern about safety levels at Pike River.

She says the shock has not worn off, and she welcomes the inquiry.

"I can’t get it around my head that they had the best technology in the world … I’ve been asking myself how this could happen."

Grey District mayor Tony Kokshoorn says the inquiry is the best solution in achieving truth and honesty in the investigation.

“It’s fantastic news. It’s absolutely central that we get this. I thank John Key for doing this," he said.

"People must be able to speak out – the people that want to – and [they] need to be able to do that unhindered."

Kokshoorn says the major concern for the inquiry needs to cover why the explosion happened and how to prevent similar situations in the future.

The Prime Minister will travel to Greymouth with other ministers for a national memorial on Thursday.

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